Arms Control Wonk

23 Responses to “FEPC Info Sheet 3/28”

1. 

   yousaf | March 28, 2011

   If the nuclear industry can survive without government bailouts then it would be worth entertaining. As it stands, the Price-Anderson Act is an on-going bailout and among the few reasons that nuclear power plants are built:

   http://www.nader.org/releases/63099.html

   quote:

   “Many nuclear suppliers express the view that without Price-Anderson coverage, they would not participate in the nuclear industry,” reports the NRC.

   If an industry which has benefited from massive government research and development and other subsidies for more than four decades, and which creates staggering, environmentally dangerous waste disposal problems and poses enormous risks to human health, cannot survive without government support, then it should not survive. ”

   =======

   All energy sources need be priced more accurately (i.e. to be more expensive) to reflect their true societal costs. This increase in price will spur conservation (and investment in renewables) that will more naturally bring an equilibrium between supply and demand.

   Houses that ran fine on ~60 amps now have ~400 amps powering them (in the West) due to the government forced false cheapness of energy in general.

   ======
   full excerpt on the Price-Anderson Act from the URL above:

   “Nuclear Insurance: The Price-Anderson Act

   The nuclear industry may be the most subsidized in U.S. history. It is completely a product of U.S. government research and development. Having emerged from massive government investments, the nuclear industry has never cut its umbilical cord tie to the government.47

   One critical, ongoing support for the industry is the Price-Anderson Indemnity Act, which limits the liability of the nuclear industry (both plant operators, and suppliers and vendors) in the event of a major nuclear accident. Under Price-Anderson, each utility is required to maintain $200 million in liability insurance per reactor. If claims following an accident exceed that amount, all other nuclear operators are required to pay up to $83.9 million for each reactor they operate. Under the terms of Price-Anderson, neither the owner of a unit which has a major accident nor the entire utility can be held liable for more than these sums. As of August 1998, this system capped insurance coverage for any accident at $9.43 billion.48

   When the Price-Anderson Act was adopted in 1957, at the dawn of the commercial nuclear industry, “the Act was intended to overcome reluctance to participate [in the transition to private nuclear industry] by the nascent industry worried by the possibility of catastrophic, uninsured claims resulting from a large nuclear accident.”49 Leaving aside for the moment the ecological and economic risks which should disqualify continuation of, let alone support for, the nuclear industry, assume that such a rationale was defensible at the time, as the government tried to promote development of an energy source which many believed would be safe, cheap and abundant.

   But watch how the rationalization perpetuates itself. “By 1965,” the NRC reports, “when the first 10-year extension of the Act was being considered, a handful of nuclear power reactors was coming into operation, and the nuclear industry considered itself on the verge of expanding into large-scale nuclear power generation. Thus, the need for continued operation of the Price-Anderson system for the forthcoming 10 years was believed to be critical for the unrestricted development of nuclear power.”50

   A decade later, when another extension of the Act was being considered, the industry was more buoyantly optimistic than it ever had been or would be again. “With dozens of plants in operation or under construction and with hundreds more being contemplated to be in operation by the end of the century,” the industry urged that the Act be extended rapidly so that “any uncertainty about extension would not disrupt nuclear power development,”51 says the NRC.

   Now the industry is in decline. There have been no new orders for nuclear plants for the past 25 years, and aging plants are beginning to be shuttered. The original rationale for the Act is no longer plausible. But nothing has changed with respect to Price Anderson. Indeed, the NRC argues, “Given industry perception of the continuing need for Price-Anderson, and in view of the lack of new orders in plants, the situation is in some respects similar to what it was when Congress saw the need for enactment of the original Price-Anderson Act.”52

   (In one way, things are worse than they were in 1957: with nuclear plants closing due to aging, safety concerns, inefficiency and license expiration, the Price-Anderson liability cap will progressively decline in future years. If the upper end of nuclear plant closing projections occurs, available insurance funds could shrink to $4.5 billion in 2013.53)

   The industry has gone through a full life cycle, but somehow it never outgrew the need for a federal insurance scheme and liability cap. The result has been a massive subsidy to nuclear power companies. Using the NRC’s conservative numbers for the upper limit on a worst-case scenario accident and on the probability of such an accident occurring, Professors Jeffrey Dubin and Geoffrey Rothwell estimated the cumulative Price-Anderson subsidy to the nuclear industry through 1988 to be $111 billion in 1985 dollars.54 This estimate is based on NRC data on the cost of worst-case accidents — data which is conservative because it does not include health effects.

   If, again, we leave aside the demerits of nuclear power, there could be justification for a federal scheme to promote risk sharing in a context which poses a (hypothetically) very small chance of an extremely large loss. (It should be emphasized, however, that this is exactly the situation for which the private insurance and reinsurance markets are designed.) But there is no justification for combining such a scheme with an overall liability cap.

   The $9.4 billion liability is nowhere near sufficient to pay for the human health and property damages that could result from a nuclear meltdown. Nuclear Regulatory Commission studies have estimated costs in a worst-case scenario at more than $300 billion for a single catastrophe.55

   The nuclear industry’s real insurance program is not the $9.4 billion scheme of Price-Anderson, but the free insurance provided by the public. In the event of a catastrophic accident, after the $9.4 billion was spent, it is the federal government that would inevitably cover the costs — with some costs probably absorbed by victims who have their injuries compounded by inadequate compensation.

   Price-Anderson is a textbook example of the hybrid insurance-liability cap program that should be prohibited per se.

   “Many nuclear suppliers express the view that without Price-Anderson coverage, they would not participate in the nuclear industry,” reports the NRC.56 If an industry which has benefited from massive government research and development and other subsidies for more than four decades, and which creates staggering, environmentally dangerous waste disposal problems and poses enormous risks to human health, cannot survive without government support, then it should not survive. The nuclear industry cannot meet the market insurance test and, with substitute energy sources available, it is not needed. The Price Anderson Act expires in 2002. If it is not repealed before then, it should not be renewed. If nuclear facilities close as a result, well, occasionally at least, corporate America should be subjected to its widely touted rigors of a free market.”
2. 

   Jacob Davies | March 28, 2011

   “One thing that struck me about the panel, with perhaps Mark Hibbs excepted, was the gap in perception between nuclear industry and the public at large. The panel seemed to view this as an unfortunate inconvenience for the coming nuclear renaissance.”

   I have some friends who like to identify with (or as) the kind of hard scientists who are all about data and real effects and how stupid and terrible at risk assessment ordinary people are – you know, the kind of people who approvingly posted the Oehmen link, and then the Seth Godin “deaths per Watt” chart – and it is quite amazing to me just how oblivious to people’s real concerns they are and how tone-deaf their defense of the nuclear industry is.

   They seem to have no understanding of the psychology of loss aversion and risk aversion, or of how the current disaster calls into question all the risk assessments and promises of safety made for existing plants. People’s intuitive grasp of very rare events is not necessarily wrong – *because* they are rare but severe we *want to* overreact when they occur, because their rareness makes it harder to analyze the cause and prevent them from happening again, and because – being extremely rare – it is very hard to assess a priori whether the assumptions about incidence are going to turn out to be accurate.

   And when you have told everyone that an accident like this is a once in a million years occurrence, and then it happens, your credibility is shot and you may not be able to recover it. Chernobyl at least could be blamed on the manifest inferiority of the Communist system (with some truth), but this one doesn’t have that cover.

   “more than 1,000 milli Sv/hour”

   I’m recalling something else saying that a dosimeter used on site had maxed out at 1,000 milli Sv/hour. And here’s another measurement that seems to indicate the same thing. Do they have higher-rate dosimeters on site?
   • 

     FSB | March 28, 2011

     And it would be OK if the damn industry paid for its own damn insurance instead of relying on taxpayers for bailouts 50 years on.

     Get real.

     Nuclear is troglodytic. And subsidized like heck.
   • 

     Charles | March 28, 2011

     It’s not Nuclear that’s troglodytic, it’s people: The only reason why things we’ve created fail is the human element. If it wasn’t for us, these things wouldn’t be built, and so they wouldn’t have a chance to fail. Maybe we should just hold off on building things until we know for sure that we’ve perfected our skills…
   • 

     Seb Tallents | March 28, 2011

     Met too! Have you been hanging around Nextbigfuture.com?
   • 

     FSB | March 28, 2011

     Charles, “we” didn’t build nuclear. Government subsidized it into existence.

     Now, after 50 years, it should be able to survive without the umbilical cord of the government.

     But it cannot.
   • 

     Charles | March 29, 2011

     I knew governments were all-powerful, but I had no idea they had the ability to do that! If they can do this, maybe they can subsidise carbon pollution out of existence? It seems like the sky’s the limit (no pun intended).
   • 

     FSB | March 29, 2011

     Yes they are in this case: google the Price-Anderson Act
3. 

   Lab Lemming | March 28, 2011

   Has Fukushima actually killed anyone yet? Because in the three weeks since that accident, there have been:
   1 coal miner killed in Kentucky this morning
   43 coal miners killed in Pakistan (March 20)
   13 coal miners killed in Baishan, Chain (Mar 24)
   19 coal miners killed in Guiyang (March 11)

   And the long term health effects from air and water pollution are at least as severe as low to moderate dose radiation exposure.
   • 

     FSB | March 28, 2011

     Clearly coal derived energy prices need to be raised also. And nuclear power companies need to pay for their own clean-up.

     As Yousaf says, once these energies are priced correctly, re-newables will be a bargain.

     They already are, if the government stopped its subsidies to coal and nuclear. Gas is a promising source also. But it is finite also. Like nuclear and coal.

     Nuclear does not run on magic. If we used all the available know U deposits and converted all power to nuclear, the U would run out in 5 years.
   • 

     Jacob Davies | March 28, 2011

     Coal is very bad too. No question. I think in particular for China – where coal is so dirty and dangerous and is anyway meeting limits of scale – expanded nuclear may make sense. (I’m not signing my name to that idea, just saying it’s more plausible there.)

     But in the US the numbers are very different. Coal is a lot less dangerous and dirty (while still being very bad!) and anyway we are rich enough that we don’t have to just look at a choice between coal and nuclear. We can afford other energy sources if we choose to pay for them. Or rather, choose to pay for them instead of choosing to pay in both open and hidden ways for nuclear, or paying in lost lives and pollution for coal.

     We can also afford to expand natural gas production to replace at least the dirtiest coal plants and coal production methods. I’m not saying natural gas is without its own environmental problems, but it’s a lot cleaner than coal and doesn’t have the catastrophic contamination problems that nuclear risks.

     As for whether anyone has died – the answer is almost certainly “yes” because I am sure people have died as a result of the evacuation and the lack of goods being brought into the “stay indoors” zone. (Sorry, don’t have a news cite, but any such mass-scale disruption is going to cause premature deaths, especially in the aftermath of a natural disaster.) And we know that radiation-related cancers may not show up for decades. Plus, and this is kind of what I was getting at in the above comment, it’s a little early to be declaring victory at Fukushima, not to mention in poor taste.
   • 

     dmbeaster | March 29, 2011

     Uh, uranium mining has killed a lot of people, sickened a lot more, and left its own environmental disasters behind. Pretending that it isn’t lethal is nonsense. And if you are going to make a comparison, make the appropriate scale adjustment – i.e., there is a awful lot more electrical generation by coal than nuclear. And as for carbon emissions vs. the nuclear waste, hard to see how reducing carbon emissions by vastly increasing the piles of unremediable nuclear waste is an improvement. The complete inability to dispose of nuclear waste is what really makes nuclear power as a long term replacement completely unrealistic. The industry has been operating for decades now on the assumption that future technology will come up with a solution. Well, it has not, and nothing like increasing the amount of waste 1000 fold (if nuclear supplants coal and oil) while still hoping for a solution.
4. 

   bks | March 28, 2011

   Why do the pro-nuclear folks (and I was leaning that way one till this) talk in the past tense? There are more red rectangles in the current JAIF (Industry) reports than there were a week ago. Has even one red signal turned yellow or green?

   I’ll believe the *revised* data and reassurances of TEPCO vice-president Sakae Muto when I see him at the NPS taking samples from the trenches overflowing with hyper-radioactive seawater.

   –bks
   • 

     FSB | March 28, 2011

     Indeed. One wonders if TEPCO will pay for the clean up or if all Japanese taxpayers will?

     Where are the right-wing free-market types on nuclear power?
   • 

     Seb Tallents | March 28, 2011

     FSB:

     If you are looking for them to vent snark, head over to nextbigfuture.com (the lifeboat foundations tech blog), they are all there, including some very stange individuals that think the entire Fukishima mess is a response to over-regulation, and if the governments of the world would just take a step back then the free market will deliver nuclear safety.
5. 

   Stephen | March 28, 2011

   TEPCO may be nationalised”
   Looks like another case of privatised profit but public risk.
   • 

     FSB | March 28, 2011

     Of course. Everyone pays for nuclear’s ills.
6. 

   djysrv | March 28, 2011

   Coal wins.
   • 

     FSB | March 28, 2011

     Coal needs to be much more expensive due to socialized costs: e.g. Medicare expenses of people exposed to pollution.

     Once coal and nuclear are de-subsidized, renewables are a bargain. Or as they say in Mass., a baaaagain :

     http://www.boston.com/news/local/breaking_news/2011/03/citing_japan_di_1.html
7. 

   anonymous | March 28, 2011

   Renewables can’t be more than maybe 40% of energy provided to the grid because they are intermittant. The sun shines during the day and wind blows when it blows, and we have dammed up every economically feasible river. Unless fusion happens, what are we going to do when the crude runs out in fifty years? Burn coal? I think that unsubsidized nuclear will compete with the ecological cost of unsubsidized coal. And we are growing in both global population and energy consumption per capita; and nitrogen based fertilizers that feed us are made from natural gas (which will last about the same 50 years). We are going to need more energy just to feed the 10 billion that will inhabit earth in 45 years. Too bad, but in 50 years its either coal or fission for the 60% we can’t get from renewables. We will have to make due with what we can do.

   In the interim we should be funding hughly laser and plasma fusion work and hope we get lucky. Those are good jobs for scientists and engineers doing the r&d too.
   • 

     FSB | March 28, 2011

     “I think that unsubsidized nuclear will compete with the ecological cost of unsubsidized coal. ”

     OK. Let’s unsubsidize frickin nuclear and see what happens: 0 nuclear plants.

     I think both need to be unsubsidized and then the expense of those energies will favor renewables and CONSERVATION.

     See Yousaf’s post above.

     Once energy is expensive as it should be people will CONSERVE and not so much will be needed.

     We waste energy on crap.

     Get real.
8. 

   Eve | March 29, 2011

   While in 20 years nuclear may not be out because of its terawatt running advantage, it will be definitely be given a pill. Biotech, synthetic and green biology has the strong likelihood to supply much in the way of carbon and hydrogen energy sources. ATM it’s growing faster than silicon, and it definitely has advantage being green. At least it’s another player in the energy theatre
   • 

     Eve | March 29, 2011

     Let hope it’s not crushed by monopolisation!